'There is no time to lose:' Deutsche Bank is embarking on a major overhaul — and it will lead to big job losses

Deutsche Bank set for major business overhaul including
significant job losses.

The German lender plans to scale back US operations in
both rates sales and trading, while corporate finance
operations in both the USA and Asia will shrink.

Changes come as the bank reports a 79% drop in net
profit in the first quarter.

"Even a quick look at the figures makes one thing
clear: we have to take action - fast," CEO Christian Sewing
told staff.

LONDON - Deutsche Bank announced a major change of direction with
large numbers of job losses expected as a result of the overhaul.

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The plans, unveiled alongside the German lender's first quarter
results, will see Deutsche pull back from its Wall Street
ambitions, and focus instead on servicing its European client
base.

Plans involve scaling back the bank's US operations in both
rates sales and trading, while corporate finance operations
in both the US and Asia will shrink.

"The bank will scale back activities in US Rates sales and
trading, shrinking the balance sheet, leverage exposure and repo
financing while remaining committed to its European business,
which given its scale and relevance to our client base generates
more attractive returns," Deutsche Bank said.

"However, we are not strong enough in other areas of this
business. Therefore we have to act decisively and to adjust our
strategy. There is no time to lose as the current returns for our
shareholders are not acceptable."

The action is set to involve widespread job losses,
although no indication was given as to how many jobs will be cut,
with the bank saying only that it "intends to reduce front,
middle and back office costs in the Corporate & Investment
Bank and related infrastructure functions significantly."
Deutsche Bank currently employs around 97,000 people
globally.

"I know you have all worked tremendously hard in the past
few years and we in the Management Board are grateful for this,"
Sewing told staff.

"But given our results and our share price, it is our
imperative to take tough decisions and ensure we implement them
in a disciplined way."

Sewing's announcement on Thursday comes alongside financial
results which showed a 79% drop in net profit in the first
quarter. Emphasising the decision to pull back from the US, the
results showed trading revenue in the first quarter dropped 17%
from last year. Over the same period, most rivals in the space
saw revenues increase by double digit percentages.

Cryan was brought in during 2015 to try and turn round the
struggling bank, but lost the faith of Deutsche's board,
and was swiftly ousted just over two weeks ago. He was
replaced by Sewing, who is German and has been with the bank
since 1989. It was widely expected that Sewing's appointment
would lead to a strategic overhaul for Deutsche Bank.

Investors in the bank were not hugely moved by the announcements,
and by 8.55 a.m. BST (3.55 a.m. ET; 9.55 a.m. CET) Deutsche
Bank's Frankfurt-traded shares were down around 2%.